Urgent management issues raised by changes in customer preferences, customer data, technology and overall business operations due to customer predictions for 2012 2013. Predictions from Michael R Hoffman, foremost customer analytics, CRM and customer experience expert. Predictions and trends affect sales, marketing, customer service, IT, CRM, legal, operations and competition. Predictions range from optimistic to outright scary (make sure to read the detailed notes). Hoffman concludes the 2012-13 is the year to earn the right to be included in your customer's network...or else. Customers have one criteria for choosing whom they do business with: Are you customer worthy?

In a customer centric world, proximity is everything and in 2012, Local is measured by ‘distance to fulfilling customer need.”Local requires that you know where your customer is and be at their beckon call (or text or Facebook or tweet).Local is redefined as not just physical location but immediate delivery – as in a download or an immediate answer or a hyper link to the right answer or source of information or an easy to understand map or short-hand instruction for the customer to get what they really want. NOW!Local is defined by the customer in 2012 as the shortest distance between me (customer) and fulfillment of my immediate need. *Yes, you can get premium pricing, improved margin and charge fees Examples:Maybe we need a context app – or Google maps to tell us if we are in the right room like here: http://bit.ly/vknBZgAmazon “Want it delivered (tomorrow’s date)? Order it in the next 0 hours and 59 minutes, and choose One-Day Shipping at checkout. Details

Apple, Google, Amazon, Microsoft, Intel… and every retailer, service business, media company will deliver their goods and/or services through an app store this year – or at least try. As customers perceive “for every need, their must be an app,” companies and channels (re-sellers/distributors) will package every element of their products and services as “apps.” For example, buy a toaster through an app on your smart phone or tablet and choose the payment app to extend your payments then choose from a set of shipping apps to physically receive your toaster. Along the way you may have activated your message delivery app which speaks to your calendar app and synchs with your outlook app. Company caution – apps are free or $0.99 cents and while companies will test more expensive apps and business to business and premium apps – 2012 and 2013 will be the time for free and super cheap apps as companies try to participate in their customer’s network – their customer’s network of devices which intersects with the ‘network of things’.*In a customer centric world not only do customers use apps but customer service uses apps, product development uses apps. Time for company’s internal departments to come up with an internal app strategy ( Cheat notes: Apps are processes so just maybe, BPM, business process management methods and process design will be more broadly accepted as individuals design “apps” = re-usable process componentsOh, yes, now we have apps on apps

The network of things is the concept of ‘everything is a computer’ or can be observed by a ‘computer.’ The network of things is the result of the digitalization of common objects, communications devices and observation technologies (camera’s and digital transaction and electronic exchange capturing devices) linked via the internet and/or local ad hoc network systems (like blue tooth used as a communication network off the master World Wide Web grid). While the term “internet of things” has been used to describe tagging and capturing objects and devices and their relationships to one another (both virtually and actually), the network of things is the totality of all things observable along with their functions and metadata exposed and connected. In 2012 and 2013 individuals will be referenced and identifiable not only by a cross-referenced transaction or ID, but by their network of things ‘fingerprint’. Individuals identities will be recognized as unique by their actual, observable location plus the devices and sensors surrounding them at a specific time and within a specific set of functions. This new capability, to communicate with a person not just via their devices but actually changing the way devices and objects perform based on the customer’s unique profile will become a growing service and product differentiator over the next 24 months and will be one of the greatest sources of innovative product and service design for the next 10 years.

The futuristic notion of personal robots doing manual work, obeying verbal commands and defending property never anticipated that people’s actions, routines and interests could be digitally captured and that the resulting information would be used to control a person’s objects, communications and surroundings.2012 is the beginning of the “data is the robot” age. Personal data exchanged between people and devices combined with meta data observing data exchanges, personal movements, transactions and transaction attributes over time has spawned freely from disparate sources and systems for years. In 2012 and 2013, what appeared to be chaotic and random information exchanges will become categorized and arranged by individual, then by personae then by nanosegment (tightly defined customer/person segments defined by location, life stage, behavior &amp; need history, environment, devices and channels in a time sequence context). This information will be used regularly to: determine how devices operate on a person’s behalf, recommend actions (food choices, medicines, care, navigation, investments, career, social) and continuously monitor and refine recommended actions and projected outcomes on the end user’s behalf (either the customer or the company – see Good Big Brother, Bad Big Brother Essay)

Genius: an exceptional natural capacity of intellect, especially as shown in creative and original work in science, art, music, 2. a person having such capacity. 3. a person having an extraordinarily high intelligence rating on a psychological test 4. natural ability or capacity; strong inclination 5. distinctive character or spirit, as of a nation, period, or language (slightly modified from dictionary.com)With the ability to observe so much information, companies and individuals will migrate from valuing sources of information (Google index, search, number and statistics) to valuing sources of solutions. Solutions will be valued based on the ‘value’ of their actual and perceived outcomes. Valuing companies and individuals based on results is not new – what is new in 2012 and 2013 due to the transparency enabled by capturing detailed information and sub processes (like apps), and functions, companies and individuals will be able to identify the specific sources of best outcomes that are directly traceable to the individuals and groups of individuals responsible. From a company perspective, solutions need not come from an employee, they may come from a vendor (traditional outsourcing), a partner, a competitor or a customer. For example, a customer may find a use for a product or service, or a sub component or minor function of a product or service, that delivers tremendous benefits and value that would otherwise go unnoticed.

Data is everywhere – and as data becomes more structured, more accessible and more frequently shared across networks, devices, vendors… customer data is vulnerable and businesses infrastructures are vulnerable (for reference take a look at 2012 security predictions below)And while all personal privacy and confidentiality are forsaken in 2012, real financial damage will occur as criminals and hacker hobbyists share engage on new ways to trick entire commerce systems and infiltrate highly secure networks for extended periods of time. Companies and individuals must assume that their information is accessed and spoofed for adequate response planning. Encryption is nice but more advanced levels of identification, authorization and identity verification will reach critical demand in 2012. http://www.darkreading.com/blog )http://www.prweb.com/releases/TopCyberSecurityTrends/2012/prweb9039507.htmhttp://smallbiztechnology.com/archive/2011/12/warning-gloomy-2012-forecast-for-internet-security.html/http://www.kaspersky.com/about/news/virus/2011/Targeted_Attacks_Cyber_Warfare_Mobile_Threats_What_to_Expect_in_2012

In 2012, “fake” is a tremendous spring of innovation also the cause of enormous financial losses and general distrust of digital transactions and ecommerce (see prediction number 8 for how long distrust will last).2012 will see many milestones achieved in digitalization as data bits are assembled to extend real world capabilities using virtual world constructs. The definition of a product (hard product) and a service will be blurred more than ever as new combinations of ordering, subscribing, enhancing and experiencing goods transforms – look at the number of Youtube views for people ‘unboxing’ a product – people watching a video of someone opening a new product and sharing their experience – as a hint to where shared experiences and blurred reality (who really makes these videos? Are they all authentic? Should you call your agency and create an authentic opening of your products packaging video?)Joseph Pine’s and Kim Korn’sInfinite Possibility discusses virtual and real world fusion get it here http://amzn.to/rJznb5 . Companies will strive to create differentiated experiences in business to business too as more sales people, product ambassador’s, guru’s are featured in video’s, demonstrations, pod casts, simulcasts and co-casts (watch as a virtual assistant assessable your service by walking through a set of configuration questions and commands – now imagine this ‘service’ co-managing your product use on an ongoing, continuous basis. Customers will require ‘enhanced’ experiences to continue their stimulation and attention related to your product and service while fending off competitors. You must stay engaged with your customers to occupy their time and box-out (basketball term) you competitors and distractions.It is worthwhile to for executive management to evaluating experience monetization strategy by asking “what would Google do?” to add “what would Disney do?”On the extremely dark side, consumers and companies will be defrauded at unprecedented scale in 2012 due to the low cost of creating extremely realistic, if not mirrored or fully replicated, ecommerce and direct marketing scams. Virtual identities replicated in mass numbers will be used to defraud companies in various industries but particularly those that have achieved early efficiencies in electronic transaction processing. Individuals will be deceived by hybrid companies using a mix of real business practices and identity stealing, profiling infiltrating schemes. Government, police and judicial systems will continue to be inadequately prepared, skilled, staffed and empowered.

“I will never do business with you again”… “Again” is the key word here. Customers will not necessarily become more forgiving in 2012, but they will be more forgetful due to the noise in the marketplace and the constant bombarding of sales and marketing messages filling their inbox, display screens, voice mail and texts. Some customers will be pushed back to their original vendor after a bad experience simply because it’s easier to buy or use the system in place. Another large set of customers will not realize that the vendor they left is the same vendor selling to them through another channel, partner or distributor using all of the information gathered from their customer history. For example, a product bought through Amazon, eBay or Craigslist may be sold by the same company only appearing different based on the channel.This dynamic, customers being less bothered by bad experiences means reduction in service costs for very large companies that are able to model the likelihood and related processes (expense and revenue) of a disgruntled customer buying again.

Reporting will not go away in 2012 or 2013 but what is reported on will continue to shift from periodic net value results to reporting on algorithm and process outcome performance. Performance anomalies will trigger messaging to the parties responsible and the people affected. Additionally, entering 2013, alerts and reports will add recommended actions and the results of simulations and performance probabilities associated with recommended actions as Big Data becomes better managed and test and scenario optimization engines (based on continuous testing algorithms) become commonplace even in small operations and minor processes.

10. Is the body of activities and events that, once they happen and in hindsight, we will say we should have seen them coming. We are still at the fringe of the frontier in the digital age so discoveries and transformations, innovations and set backs appear quickly and frequently. Some innovations, good and evil, flash and burn out quickly others provide benefits or damage profoundly over longer periods of time. Expect to be surprised in health care, pharmacology, security, entertainment media, communications, financial services, insurance and other areas where the value of information and digitization has yet to yield a fraction of its potential. Also expect companies and governments to have to face unprecedented ethical and moral challenges due to the easy availability and access digital to information.

Customers will determine company value at each contact.The simple criteria for company success has not changed and will not change – companies must be customer worthy at each contact, each stage in the customer life cycle, or they will not earn the next stage in the customer life cycle – resulting in increased cost and underperformance.A company’s single objective should be to be customer worthy in each contact – and everyone at your company should understand this simple, simple goal. Be customer worthy in each contact, in each decision.

Once again, thank you for your time.Strive to be customer worthy in 2012.

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Will You Be Customer Worthy in 2012?1. Local Local Local… Context Can You Hear Me Now? Can You? Here! Me! Now! 2012 Customer Worthy Predictions by Michael Hoffman Available @ Amazon.com MRH@customerworthy.com